Philadelphia Education Plan Cuts Salaries, Closes Schools

The district plans to borrow $300 million to finance the current fiscal year and part of the next one, slash salaries by 26 percent over a five-year period, and close schools that "are underutilized and in poor condition."

In what one member calls "bitter medicine," the School Reform Commission has approved a five-year financial plan for the school district to help deal with a $1.35 billion hole.

The district plans to borrow $300 million to finance the current fiscal year and part of the next one, slash salaries by 26 percent over a five-year period from $858 million this year to $681 million in 2016-17 and close schools that "are underutilized and in poor condition," Chief Recovery Officer Thomas Knudsen said.

Knudsen presented the plan Monday afternoon to the SRC, which approved it in a 4-0 vote. SRC member Lorene Cary was not present because she was on vacation, spokesman Fernando Gallard said.

Knudsen asked employees to "come to the table and contribute directly" to the district's educational program, as did blue-collar Local 32BJ. The union's 2,700 workers agreed to give weekly contributions of $5 to $45 to help reduce the district's $282 million budget deficit.

The plan can't succeed without district employees helping, Knudsen said.

SRC Commissioner Joseph Dworetzky said that he supported the plan, but many aspects of it will change. And that certainty provides "some degree of comfort for those of us who are disturbed by some of the bitter medicine the plan contains," he added.

Dworetzky, who never shies away from questioning contracts brought before the SRC, urged "greater vigilance" over spending costs. He cited contracts as well as investments in programs for high-performing students.

One large expense for the district is for charter schools, which is projected to jump 38 percent from $589 million this year to $812 million in 2017, according to the plan.